Posts Tagged ‘BLS’

Notes From Underground: We Won’t Be Fooled Again

May 14, 2014

I’ll move myself and my family aside

If  we happen to be left half alive

I’ll get all my paper and smile at the sky

For I know that the hypnotized never lie
                                   — The WHO
I’d like to follow-up yesterday’s blog post and the dilemma for the Fed in regards to low inflation and low wages, as in, which way will interest rates turn? Today the bond yields dropped in spite of a much higher PPI (producer price index), which measures wholesale inflation. If producers cannot pass higher input costs onto the consumer, profits will suffer. Tomorrow, the BLS will release the consumer price index, CPI, which is expected to be up 0.1 percent on the core and 0.3 percent on the headline number. If the data is higher than market consensus it will be interesting to see if the BONDS and NOTES shrug off inflation fears and continue the recent rally. The price of the 10-year note closed above the 200-day moving average for the first time in two months, even as the 30-year bond has been above the 200-DMA for the same period of time. The rally in the 10-YEAR NOTE acted to flatten the curve but I warn you, readers, that this curve is far from being flat by historical measures. Two-hundred eighteen basis points is far from being flat and again I remind readers that a year ago the 2/10 curve was a much flatter 145 basis points.

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Notes From Underground: Good Grief, a Chinese Rating Agency Downgrades U.S. Debt

October 17, 2013

Can a centrally directed economy spawn a neutral credit rating agency? Readers of NOTES have long been aware that I hold Chinese data releases in the lowest regard. My disdain is based on the inability of GOOGLE to operate freely in China and provide a forum for the “free” flow of ideas and critical thinking. There is no free and open society (Karl Popper). So I find it tragic that the markets paid attention to a downgrade of U.S. debt by the DAGONG  rating agency. It is bad enough that the U.S. rating agencies are tainted by the desire for profits and are paid by the sell side of the street. But a sense that a Chinese rating agency could be independent of state influence is enough to upgrade the U.S. arbiters of credit … to well, AAA.

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Notes From Underground: The Unemployment Data Was Almost as Disappointing as Europe

July 10, 2011

Friday’s unemployment report revealed that Thursday’s ADP data was, again, a “FALSE POSITIVE.” The 157,000 ADP gain failed to show in the BLS numbers and all the Wall Street economists were caught off guard as they spent Thursday night ramping up their guesstimates to be more in-line with the private sector prognosticator. The initial response by the EQUITIES was to sell off as the lack of job growth undermines the recent S&P and DOW rally. At day’s end, the equities staged a rally and the loss on the day was small, especially relative to the strength shown early in the week.

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Notes From Underground: Unemployment in the U.S.–Does Slowing Jobs Provide the FED With a Pause That Refreshes?

June 5, 2011

The U.S. jobs report provided great support to the bears on Wall Street as the 54,000 nonfarm payroll number led to a sell off in the DOLLAR and another drop in the Dow, S&Ps and all other equity indexes. For all the equity down/dollar up analysts, last week was a breakdown of that temporary correlation. U.S. equities were down more than 2% for the week while the EURO was up 2.5%. It seems that the global financial community is becoming more concerned about a softening U.S. economy and what it will mean for the budget discussions and FED policy.

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